The former king of the home rental market has struggled to adapt to the digital age with home streaming through rental services like iTunes, or all-you-can-eat portals like Netflix or Lovefilm taking over.

Despite the falling demand for physical media, Blockbuster has continued to only offer DVD, Blu-ray and games rentals and purchase in store, as well as through online subscriptions.

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Blockbuster's new owner had attempted to introduce a digital service, it said, but had failed to reach a licensing agreement with the US parent company.

"Regrettably, the months since the acquisition have also coincided with a period of poor trading performance across both rental and retail sales," said Gordon Brothers.

The company will now begin the search for a new buyer, while stores will continue to trade during while the Blockbuster sits in administration.